By Barani Krishnan
Investing.com - Gold prices advanced in the $1,700 channel on Tuesday as a new wave of coronavirus infections in China drove buyers toward safe-havens.
U.S. gold futures for August delivery settled up $9.30, or 0.5%, at $1,736.50 per ounce.
Spot gold, which tracks real-time trades in bullion, rose $2.16, or 0.1%, to $1,727.21 by 2:32 PM ET (18:32 GMT).
Gold came off its highs for the session and gave back some gains after U.S. retail sales for May jumped 17.7%, from a record 16.4% slump in April forced by coronavirus lockdowns, data showed.
The yellow metal rallied earlier after Beijing’s city government on Tuesday raised its Covid-19 emergency response level to II from III. The Chinese response came as new daily coronavirus cases in its capital grew to 106, putting 29 communities in the city back on lockdown.
“Risk appetite can’t survive another lockdown in China, because that likely means both Europe and the US are nowhere near the end with their battles with the coronavirus,” said Ed Moya, an analyst at New York’s OANDA. “The stimulus trade is intact, but virus uncertainty seeping back to China will prevent U.S. equities from recovering all of last week’s losses.”
Wall Street’s Dow was up 2.3%, extending its recovery from Monday, on the U.S. retail sales rebound for May and Federal Reserve Chairman Jay Powell’s assurances of continued stimulus support for the U.S. economy until it fully recovers from the impact of the pandemic. The Dow fell nearly 6% last week on fears of a new uptick in U.S. infections of the virus, which has already logged more than 2 million cases and 118,000 deaths.